“Big down day for stocks. The Dow lost 198 points. Why? Are investors worried about gridlock in Washington? Or falling property prices in Beijing? Or maybe it’s the European debt crisis that has them bugged? It doesn’t matter. When Mr. Market wants to go down, he’ll go down. He’ll leave to us to come up with the ‘reasons’ afterward. The real reason? The US economy is sinking into a deeper Great Correction. No kidding. Here’s the latest:

WASHINGTON (AP) – 'Businesses cut back on orders for aircraft, autos, heavy machinery and computers in June, sending demand for long-lasting manufactured goods lower for the second month in the past three. The Commerce Department says orders for durable goods fell 2.1 percent in June, with the weakness led by a big drop in orders for commercial aircraft. A number of other categories also showed weakness including autos and auto parts. A key category that tracks business investment plans fell 0.4 percent in June.'

But domestic sales of durables is much worse…the lowest in 20 years. For the last year and a half, the stock market has been signaling ‘recovery.’ Prices rose from a Dow low on March 9, 2009 below 7,000 to a high over 12,500. But while stocks recovered, the economy didn’t. The rich got richer – those who owned stocks. The middle classes – who tend to own houses, but not stocks – got poorer.

So, the big question: who’s right? The stock market? Or the economy? Which way is it going to go? Is the stock market going to fall to meet the real economy? Or is the economy finally going to recover to justify the kind of stock prices people are paying? Our money is on falling stock prices. For all the many reasons we’ve told you in these Daily Reckonings, we don’t think you can turn this economy around …not anytime soon. This is a debt contraction. It takes time. Years. In fact, at the present rate – about 5% of GDP per year – we’ll have to wait another 36 years before consumer debt to GDP is back to the 100% level. For reference, it was about 33% when then expansion began after WWII.

We’ve been waiting a long time for the stock market to prove we are right. Until now, neither it nor the economy was willing to give. Stocks stayed high. The economy stayed low. Maybe yesterday, stocks began to ebb lower. Maybe they are just bouncing around. We’ll have to wait to find out. Investors are probably a little jittery…waiting for a deal on the debt ceiling. When the deal is announced, stocks will probably rise again. But maybe not. Sooner or later they’ll have to come to terms with the Great Correction. Maybe they’ll do now. Stay tuned.”

“Debt Downgrade, Not Default, is the Problem”
By Greg Hunter’s USAWatchdog.com

“Watching the debt negotiations is like watching two stubborn people headed over a waterfall. Both are too blockheaded to steer the boat towards land on the left or the right. So, both go over the edge and will see how long the other can hold his breath. Both, of course, drown in this story, right along with the rest of the country. Yesterday, Speaker Boehner said he wanted to call the President’s bluff and not give him a “blank check.” The President, on the other hand, has said (many times) he’s going to veto any plan that doesn’t raise the debt ceiling past the 2012 presidential election. I know many think there is going to be a last minute deal before the August 2nd deadline, but I just don’t see it. If the Republican bill from the House makes it past the Democrat-controlled Senate and there is only an increase in the debt ceiling to make it for 6 months or so—veto here we come. Or maybe, there is no bill that can get through Congress, and nothing even makes it to the President’s desk by the August 2nd deadline.

I eventually see a debt deal getting done, but not until after the August 2nd. That’s when the Treasury says it will exhaust its borrowing limit. In this scenario, both parties hope the other side will take it on the chin and be hurt worse in the eyes of voters. I don’t know who will come out on top if this happens, but big time damage to the U.S. economy will be done. Forget about default on the U.S. Treasury debt. That is simply not going to happen, at least not anytime soon. America has the money to pay the interest on its Treasuries. It is the credit rating of the United States that will take a beating. In the latest report from Shadowstats.com, economist John Williams said, “If I were to script a scenario as to how the United States quickly could debase the U.S. dollar with maximum impact, impairing the dollar’s reserve status and dwindling global credibility, and accelerating the movement towards a U.S. hyperinflation, it would be extremely difficult to come up with a more destructive course of action than what already is taking place in Washington, D.C. The chances of a U.S. debt default remain nil, but risk of a U.S. sovereign credit rating downgrade—though small—is increasing. . .”

If the debt of the United States is downgraded, other debt will also be downgraded. As credit ratings go down, interest rates do the opposite. U.S. consumers would start paying more for things like credit cards, mortgages and car loans. Hundreds of municipalities would also pay higher borrowing costs for their debt. These are just a few of the interest rate wild cards. This would put a huge drag on an economy that is already on the skids. The dollar would also take a pounding because nervous investors would start to dump dollars and Treasuries. The Shadowstats.com report goes on to say, “The administration claims the U.S. will default if the debt ceiling is not raised by August 2nd. There are those who suggest there is more time beyond that, if only the government selectively pays its bills, giving priority to interest and debt payments. With other government obligations not paid as due, though, that circumstance likely would trigger the rating downgrades and intensify dollar dumping and abandonment.”

Paul Craig Roberts, former Assistant Treasury Secretary in the Reagan Administration, agrees with the Shadowstat.com analysis. In a recent essay, Roberts said, “The US dollar could plummet in exchange value and lose its role as world reserve currency. The US would no longer be able to pay its oil bill in its own currency, and as its balance of payments is heavily in the red, the US has no foreign currencies with which to pay its oil import bill. Or its manufactured goods import bill, or any other bill. We are talking about a crisis beyond anything the world has ever seen. Does anyone think that President Obama is going to just sit there while the power of the US collapses? He doesn’t have to do so. There are presidential directives and executive orders in place, put there by George W. Bush himself, that President Obama can invoke to declare a national emergency, suspend the debt ceiling limit, and continue to issue Treasury debt. This is exactly what would happen. The consequences would be that the power of the purse would transfer from Congress to the President.” (Click here for the complete Paul Craig Roberts post.)

I think, by now, both parties are calculating how bad the fallout will be and which party gets the blame if a debt ceiling deal is not done by the August 2nd deadline. Could the Republicans really not want the economy to get much better until after the 2012 election? On the other hand, maybe the Democrats know the economy stinks and figure it won’t get much better anyway come election time. Might the President veto a bill he hates and blame a plunging economy and government shutdown on the Republicans? Bill Clinton did a similar thing in the mid-90’s, remember? Although, the stakes this time around are exponentially higher.

It wouldn’t be hard to sell a “national emergency” to the public if the stock market sold off a couple of thousand points and gasoline prices went to 8 bucks a gallon—would it? Whether or not you like Barack Obama, never underestimate the power of the President. Wouldn’t it be strange if a debt deal finally got done on August 15, 201l? That’ll be exactly 40 years to the day President Richard Nixon took America off the gold standard.”

"It's been a while since I discussed our country's increasing resemblance to a banana republic, but four recent reports essentially confirm that we're more like those third world countries we used to make fun of than many people think. Among the things we have in common:

1. Significant corruption: "Poll: Plurality Say Congress is Corrupt" (UPI). A plurality of Americans say they think most members of Congress are corrupt, with less than a third saying the opposite, a Rasmussen Reports survey indicated. The survey, released Wednesday, also indicated a staggering 85 percent of voters said they believe congressional members are interested in advancing their own careers rather than helping people. Forty-six percent of likely voters said they view most members of Congress as corrupt, up 7 percentage points from June and the highest finding yet, Rasmussen Reports said.

2. Deteriorating infrastructure: "Infrastructure Woes Take Toll on US Economy-Engineers" (Reuters). Failing infrastructure will cost the United States billions of dollars in lost productivity, income and trade in coming decades, according to a civil engineering report released on Wednesday that said the impact on gross domestic product could reach $2.7 trillion.The American Society of Civil Engineers regularly tallies the amount needed to upkeep declining U.S. roads, bridges and waterways. It said the country will need to invest roughly $220 billion annually to maintain the country's infrastructure in "minimum tolerable conditions." It said the gap between infrastructure needs and federal funding is growing. "If present trends continue, the funding gap for rail and bus transit, seen as 41 percent in 2010, is expected to increase to 55 percent in 2040," it said. "The expected gap in highway funding, 48 percent in 2010, is expected to increase to 54 percent by 2040."

3. Reckless fiscal policies: "Republican Leaders Voted for Debt Drivers They Blame on Obama" (Bloomberg). House Speaker John Boehner often attacks the spendthrift ways of Washington. “In Washington, more spending and more debt is business as usual,” the Republican leader from Ohio said in a televised address yesterday amid debate over the U.S. debt. “I’ve got news for Washington - those days are over.” Yet the speaker, House Majority Leader Eric Cantor, House Budget Chairman Paul Ryan and Senate Minority Leader Mitch McConnell all voted for major drivers of the nation’s debt during the past decade: Wars in Afghanistan and Iraq, the 2001 and 2003 Bush tax cuts and Medicare prescription drug benefits. They also voted for the Troubled Asset Relief Program, or TARP, that rescued financial institutions and the auto industry. Together, according to data compiled by Bloomberg News, these initiatives added $3.4 trillion to the nation’s accumulated debt and to its current annual budget deficit of $1.5 trillion.

As Congress nears votes to raise the $14.3-trillion debt ceiling to avert a default on U.S. obligations when borrowing authority expires on Aug. 2, both parties are attempting to claim a mantle of fiscal responsibility. They both bear some of the blame: Many Democrats contributed to the expenses that are forcing lawmakers to boost the nation’s debt limit, as have Republican leaders at odds over how much borrowing authority to hand President Barack Obama and when. “There’s plenty of blame to go around,” for the debt, said Robert Bixby, executive director of the Concord Coalition, an Arlington, Virginia-based group that advocates for balanced budgets. “If there had been no Barack Obama, we would still be bumping up against the debt limit.’”

4. Significant wealth and income inequality: "Growing Share of Income for the Rich" (Washington Post). Inequality in the U.S. has has grown steadily since the 1970s, following a flat period after World War II. In 2008, the wealthiest 10 percent earned almost the same amount of income as the rest of the country combined.

SHARE OF NATION'S INCOME, Including capital gains:

Rich vs poor: The top 0.1 percent of the population (those making about $1.7 million or more) saw the sharpest increase in income share, taking home 2.6% of the nation’s earnings in 1975 and 10.4% in 2008. It's not your father's America, that's for sure.”

Wednesday, July 27, 2011

"While most spiral galaxies, including our own Milky Way, have two or more spiral arms, NGC 4725 seems to have only one. In this sharp color image, the solo spira mirabilis is tightly wound, traced by bluish, newborn star clusters. The odd galaxy also sports obscuring dust lanes, a prominent ring, and a yellowish central bar structure composed of an older population of stars.

Click image for larger size.

NGC 4725 is over 100 thousand light-years across and lies 41 million light-years away in the well-groomed constellation Coma Berenices. Computer simulations of the formation of single spiral arms suggest that they can be either leading or trailing arms with respect to a galaxy's overall rotation."

"Like the whales each of us has a unique song or gift to offer the world as is meant to be heard by others. Native Americans teach us that the Great Spirit speaks to us through our animal brethren. The whale is one animal that we can learn from. Whales have existed for over 50 million years and are considered to be record-keepers who possess knowledge of the past.

It is through the vibrations of their unique sound that they release this ancient wisdom to us. Every whale sings a song, and they never repeat the same pattern when they sing their song. Since whales must be conscious at all times in order to breathe, they cannot afford to fall into an unconscious state for too long. Never completely asleep, their brain has constant access to the collective unconscious where all answers lie. Whales float peacefully, secure in the ocean environment that supports and sustains them.

You can learn from the wisdom of whales by remembering to express what’s uniquely yours. Each of us has a unique “song” or gift to offer the world. Your song is meant to be sung by you and heard by others. No one else can sing this song but you, and your song is medicine for the healing of the planet. Like whales, you can choose to access information about the future when you go into a meditative state. Whales teach us to look at where we came from and where we are headed. Knowing that our past helps shape our future, we can remember to make positive choices regarding our lives, the environment, and our world. Like whales, we can remember to stay awake and actively engaged in a universe that supports and sustains us. When we express ourselves and share our unique gifts, we add our wisdom and vibration to the planet."

“Many years ago there was a tree and a man. They met in a forest one day. They gazed at each other. The man fell in love with the tree and the tree fell in love with the man. The man so admired the beautiful outstretched branches of the tree- its youth- the vibrant leafs, the sweet sap, the gentile swaying of her branches in the breeze. The tree felt at home with the man- admired- finally known for who she is- a little less alone.

Years passed. The tree became less beautiful. Some of the branches were barren. She began to lean over a bit. The man grew bored. The tree was no longer as beautiful to him. The man was unhappy and the tree no longer made him happy. So one day the man moved on. He left the tree and never returned. At first the tree was puzzled. She said to herself, “I thought he loved me.” The sun loves me, the birds love me, the wind caresses me- they always return- we are never apart. But this man has disappeared. Why? Did he ever love me or was his love, like his rejection, nothing more than a game he played with himself. The tree felt used, but finally the tree understood the truth. The man never loved the tree, but only the saw the tree for what it could do for him. When the tree no longer did what the man wanted- he left.

The tree wonders- will I ever find true love? Will I ever be loved for who I am? The tree knows that she has always loved and has always been loved- by the sun, the stars, the mountains, the river, the rain and the wind. But she also knows... the man never loved her. He can’t even love himself.”

"There are times, however, and this is one of them, when even being right feels wrong. What do you say, for instance, about a generation that has been taught that rain is poison and sex is death? If making love might be fatal and if a cool spring breeze on any summer afternoon can turn a crystal blue lake into a puddle of black poison right in front of your eyes, there is not much left except TV and relentless masturbation. It's a strange world. Some people get rich and others eat s**t and die. Who knows? If there is in fact, a heaven and a hell, all we know for sure is that hell will be a viciously overcrowded version of Phoenix — a clean well lighted place full of sunshine and bromides and fast cars where almost everybody seems vaguely happy, except those who know in their hearts what is missing... And being driven slowly and quietly into the kind of terminal craziness that comes with finally understanding that the one thing you want is not there. Missing. Back-ordered. No tengo. Vaya con dios. Grow up! Small is better. Take what you can get...”

“In her new book, “Emotional Freedom,” UCLA psychiatrist Judith Orloff identifies five kinds of vampires that are lurking around and can zap our energy if we’re not careful. Here is an excerpt adapted from her book.

"Emotional vampires are lurking everywhere and wear many different disguises–from needy relatives to workplace bullies. Whether they do so intentionally or not, these people can make us feel overwhelmed, depressed, defensive, angry, and wiped out. Without the self-defense strategies to fend them off, victims of emotional vampires sometimes develop unhealthy behaviors and symptoms, such as overeating, isolating, mood swings, or feeling fatigued.
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Here are five types of emotional vampires you’re likely to encounter, and some “silver bullet” tips for fending them off;
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Vampire 1: The Narcissist. This vampire is grandiose, self-important, attention hogging, and hungry for admiration. She is often charming and intelligent–until her guru status is threatened.Self-defense tips: Enjoy her good qualities, but keep your expectations realistic. Because her motto is “me-first,” getting angry or stating your needs won’t phase her. To get her cooperation, show how your request satisfies her self-interest.
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Vampire 2: The Victim. This vampire thinks the world is against him, and demands that others rescue him.Self-defense tips: Don’t be his therapist, and don’t tell him to buck up. Limit your interactions, and don’t get involved in his self-pity.
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Vampire 3: The Controller. This vampire has an opinion about everything, thinks he knows what’s best for you, has a rigid sense of right and wrong, and needs to dominate.Self-defense tips: Speak up and be confident. Don’t get caught up in bickering over the small stuff. Assert your needs, and then agree to disagree.
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Vampire 4: The Criticizer. This vampire feels qualified to judge you, belittle you, and bolster his/her own ego by making you feel small and ashamed.Self-defense tips: Don’t take what she says personally. Address a misplaced criticism directly. Don’t get defensive. Express appreciation for what’s useful. Bounce back with a massive dose of loving-kindness.
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Vampire 5: The Splitter. This vampire may treat you like his BFF one day, and then mercilessly attack you the next day when he feels wronged. He is often a threatening rageaholic who revels in keeping others on an emotional rollercoaster.Self-defense tips: Establish boundaries and be solution-oriented. Avoid skirmishes, refuse to take sides, and avoid eye contact when he’s raging at you. Visualize a protective shield around you when you’re being emotionally attacked."

Judith Orloff, MD, is an assistant clinical professor of psychiatry at UCLA. Her new book, upon which these tips are based, is “Emotional Freedom: Liberate Yourself from Negative Emotions and Transform Your Life.”

•

Of course, not that any of us have these life suckers lurking in our lives... -CP

"We don't think of the universe as a terribly wet place, but in fact there's water out in space pretty much everywhere you look. A few billion years ago, Mars was awash in the stuff, with rivers scouring twisted channels en route to ancient seas. The solar system from Jupiter outward would be an interplanetary water park if most of the H2O out there weren't frozen. Saturn's rings are made mostly of trillions of chunks of ice. The comets are mostly ice. So is Pluto. Jupiter's moon Europa has a thick shell of ice surrounding a salty ocean, kept warm by the little world's internal heat. Saturn's moon Enceladus spews subsurface water into space in titanic geysers that form a ring of vapor that surrounds Saturn. Uranus and Neptune are known to planetary scientists simply as "ice giants."

And it doesn't stop in our solar system. Water — solid, liquid or vaporous — has been turning up for years, all over the cosmos. So it takes a pretty impressive discovery to put space water in the headlines. But impressive may be an understatement for what two international teams of astronomers have turned up. Peering out to the very edges of the visible universe, both groups have detected a cloud of water vapor, weighing in at a mind-bending 140 trillion times the mass of the world's oceans, swirling around a giant black hole 20 billion times the mass of the sun.

To be precise, the water vapor is mixed with dust and other gases, including carbon monoxide, forming a cloud hundreds of light-years across. (The star closest to Earth, Proxima Centauri, is less than four light-years away.) The cloud is so enormous that while it's incredibly massive, it's also vanishingly sparse: the thinnest morning fog is hundreds of trillions of times as dense.

Most surprising of all, perhaps, is that finding such an immense reservoir of water lurking in the cosmos just 1.6 billion years or so after the Big Bang makes perfect sense. Hydrogen has always been the most common element in the universe. Oxygen is less common, but there's still plenty of it, and the two love to combine whenever they get the chance. And in fact, earlier observations had turned up water from only about a billion years later in the life of the cosmos. Earthly astronomers have previously used water vapor swirling around a black hole to try to understand the mysterious dark energy that pervades the cosmos.

The scientists are doing something similar with this new discovery — studying the water to infer what's going on in the black hole. They already know it's not just a black hole but one of a special subclass known as quasars. The body's immense gravity is sucking in gases at a prolific rate, squeezing and heating them until they blaze with a light that can be seen across the universe. Without seeing the water vapor, however, the scientists wouldn't know how much gas lies outside the superheated region and thus how much potential the black hole has to grow. (The answer: It could in theory swell from 20 billion times the mass of our sun to 120 billion times.)

For another class of astronomers, meanwhile, water in the universe has a different significance entirely. As far as anyone knows, water is a basic requirement for the emergence of life. For biology to have arisen on other planets, either inside the solar system or outside it, the fact that there's plenty of the stuff everywhere you look is reassurance that life may be very common too. Much of the water in the universe takes the form of ice, lots as water vapor. But it took only a relatively teeny amount in liquid form to nurture life on Earth — and there could easily be plenty of other places in the Milky Way where the very same thing is going on."

"We’re here in Vancouver at Addison’s “Fight or Flight” investment symposium. More on that as the week progresses… Yesterday, stocks went down another 90-some points on the Dow. Oil stayed just under $100. And gold is still hitting records. According to the papers, investors are on the edge of their seats. They’re waiting to see what happens in Washington. Everybody knows that a default would be disastrous. That’s why everybody also doesn’t worry about it; ‘they won’t let it happen,’ they say to themselves.

“Neither side budging,” is a subhead from yesterday’s New York Times. It is widely assumed – even by us – that they’re going to budge soon. Otherwise, all Hell will break loose…and they’ll be blamed. The Democrats are afraid they’ll be blamed more than the Republicans. The Republicans are afraid they’ll be blamed more than the Democrats. And neither side really has the guts or gumption to play this game of chicken to the end. Instead, they’ll budge. And they’ll come up with a solution that will be every bit as effective as the European’s solution to the Greek debt situation.

“Hogwash,” is how Felix Zulauf describes the European solution. It is a political fix…not a market solution. The market was discounting Greek debt by half. The politicos gave it a 20% haircut, lent more money, and kicked the can down the road again. Hogwash is what we’ll get in the US too. Even worse. No discount. And a bigger kick.

The real solution is the one neither Democrats nor Republicans can tolerate – letting Mr. Market sort it out himself. Mr. Market is a pro at this sort of thing. He’ll get the job done. He’d probably write down the value of all debt…and toss out the stuff that can’t be repaid. In a few months, the crisis will be over. Then, the economy could stage a real recovery. “Bill, are you saying that there wouldn’t be grave consequences to a US default? How can you be sure it wouldn’t trigger a full depression?”

Hey, we’re not sure of anything. And we wouldn’t be a bit surprised to see a depression. Unemployment would probably soar. House prices would collapse even further. Stocks would probably get sawed in half. And GDP would go negative in a big way. What’s more, real interest rates would be higher…investors would be wary of US government debt, making it harder for the feds to continue their old free-spending ways too. Atlantic Magazine lists “13 ways a debt ceiling breach would destroy the economy.” It’s the usual claptrap. Default would send interest rates up. Higher interest rates would make recovery harder, and so forth. And don’t forget that the feds send out 88 million checks a month. If something were to happen – such as a default, which kept people from getting their checks – it would be a serious blow to the economy. Without this consumer income, the economy would go into a kamikaze dive.

All true. And all nonsense. We don’t doubt that a default by the feds, even a technical, temporary default, could cause the economy to sink. But the way we see it, the economy still needs to reckon with all the problems it encountered in the crisis of ’07-’09. The problem was debt. There was too much of it. Until it shakes this dust off its sandals, it can’t build on a firm foundation. The authorities tried to deal with that problem by adding more dust. More debt. A new GAO study shows that in the ’07-’09 crisis, the feds put out an amount greater than the entire GDP of the nation in order to stimulate the economy. What did it get for all that money?

Nothing but more debt. Why? The Keynesian stimulus model stops working when the economy shifts from adding debt to destroying it. Then, you can put out all the additional cash and credit you want. It won’t do any good. Households are reluctant to borrow; first, because they don’t have the income or the collateral to support it, and second, because they’ve already got too much debt and are eager to get rid of it. When the economy goes into a credit contraction, trying to add more debt is like pouring whiskey down the throat of a passed-out drunk. It’s not the kind of medicine he needs. He needs to dry out. And get rid of the debt. That’s what a depression…a default…a bear market…and higher interest rates can do for an economy. The sooner the better.

We’ve been putting the pieces together. Last weekend, we noticed that the “Imperial Agenda” was part of the reason the middle class is going broke. Cheap credit helped finance the middle class spending spree. It also helped finance the empire. Without artificially cheap credit, neither the federal government, nor US households, would be in the mess they’re in today. And now the empire follows its own inevitable course. Bread at home. Circuses abroad. The voters won’t give up either one.

As for the bread at home, 44 million people now get food stamps. One of every four children gets them. The US Treasury sends out 88 million checks every month. And 51% of the public now gets some of its money from the feds. Overseas, the circuses get bigger, more costly, and more absurd. The US is now involved in 6 military adventures in the Mideast and North Africa, if you include its intervention in Yemen and Pakistan. It maintains bases all over the world. And it now costs $1 million to keep a single US soldier in the field in Afghanistan. How long can it afford the costs? The federal government gets roughly $2.2 trillion in tax revenue. It spends roughly $3.6 trillion. You can see for yourself, the feds have to borrow nearly 50 cents for every dollar in revenue.

But wait…we’ll ‘grow our way out of debt’ just like we’ve always done in the past, won’t we? Uh…no. Not this time. Because the last time the US had this much debt was immediately after WWII. “After” is the key word. WWII had a beginning and an end. The homeland population made sacrifices during the war so they were ready to spend when it was over. Military spending could be dramatically cut, too, giving the domestic economy a boost. But now, the wars never begin and never end. There are no declarations of war. No debates in Congress. No surrenders. No armistices. No ticker-tape parades. We now have wars that go on forever against enemies who are never clearly identified, at costs that can’t be calculated and for reasons that can’t be explained.

Meanwhile, at home, the feds no longer offer relief to those who are temporarily unemployed or to an economy that is in cyclical recession. Now, they give permanent support to people whose jobs are gone forever…and to an economy locked in an eternal slump. The wars go on and on overseas. At home, the recovery never comes. And the Empire goes broke.”

Norway, with a GNP-per-capita score not so far from that of Qatar and no unemployment, had brewed its own post-liberal neo-fascist outrage. Anders Breivik AKA Andrew Berwick, a latterday Knight Templar defending the Holy City of Jerusalem, free market economics and the wars in Iraq, Libya, Afghanistan and Pakistan had struck - real hard. This raises the question: How are we going with the postliberal or even postmodern and posthistorical War Economy, these days ?

THE WAR ECONOMY: Obama's famous 14,297 billion dollar debt ceiling underlines a simple fact: printing more new money is now so urgent that going to war is far too slow. Besides, ever since the supershow of 9/11 and a public demolition event at a major New York tourist-and-finance venue, designer wars 'over the horizon', AKA the Middle East have been on a downturn, despite the collateral civilian dead. Obama's new debt ceiling party, called a stimulus bill by some, and unreal by almost anybody else is far larger than the total combined cost of World War 1 and World War 2 to the USA. It is around 5 times bigger than the combined costs of the USA's post-2001 designer wars estimated at a total cost of around 2,100 to 2,800 billion dollars. Getting the debt ceiling sealed and delivered could therefore take several more 24-hour chat shows inside the White House and on primetime, but nice editorialists say the event is likely only a 10-day wonder. Like the Norway massacre, this boggles the mind.

Before we get around to US Treasuries selling for pennies on the dollar, things need to move. The problem is "it never happened before", just like the Greek-PIIGS and Japanese meltdowns. All we have on display in the firesale shopwindow is the Asian Locomotive growth economy to keep us happy. Hailed as saving us all, by CNN Business and Bloomberg experts, and likely by the UK "Sun" this miracle loco is easy to understand because it is a literal carbon copy - a high carbon copy - of the postwar economic growth miracle which happened in the Old Rich/New Poor societies until they were hit by the 1970s oil shocks. China and India are shovelling coal into their locomotive right now: a combined total of around 2.7 billion tons of coal a year. Their coal burning grows every year. This is guaranteed but when or if it doesnt, the Asian growth miracle terminates, and then mutates in ways we will find out quite soon.

Economists peddling the postwar growth economy, with its cute designer wars as a side dish could ask the average iPhone enabled postindustrial consumer living the Internet revolution if they knew their industrial iPhones and PCs were made from coal and run on coal, when they aren't made from oil and run on electricity made from much more coal and gas - than nuclear power or homeopathic doses of Green Energy, to amuse and fool the crowd ? At times like today, there is only space for the growth mantra: so simple that even braindead TV advertising gets it word perfect. It says: Keep The Party Going, and the no surprise is that nobody wants to know.

The war economy, like its downsized civilian counterpart runs on coal and heavy industry. Al Gore and Rajendra Pachauri, Nobel prizewinners for alerting consumers in the Old Rich/New Poor societies to the dangers of CO2 could try the question of what would happen to remaining strands of the growth economy, if China and India suddenly gave up coalburning, and replaced the coal with oil and gas "to save the planet". Gasoline would be rationed in every single Old Rich/New Poor country, not just using high prices but those cute old-fashioned, postwar ration books the Baby Boomers parents used.

CANARY IN THE GOLD MINE: The new and giant middle class populations of China and India, by early 2011 were buying physical gold bullion in volume due to their concern about inflation and the declining value of their respective paper currencies. Gold demand by China was expected to rise about 20 percent to near 700 tons in 2011; Indian private gold buying was estimated at more than 200 tons in the first 3 months of 2011. Combined, this demand is running at far above one-half of likely world total gold production, of around 2500 to 2700 tons for the year. So why shouldn't China and India take one-half, or more than that, of world oil output ? Like anybody can tell you, this is physically impossible. Period and full stop.

To be sure, this is the hidden basic agenda of the late-stage growth economy. Any postindustrial consumer-voter in the Old Rich/Hyper Debt countries knows why there are oil wars over the horizon. They know they need 10, 15 or 20 barrels of oil a year to be postindustrial, produce nothing, and consume every possible industrial gimmick, from fastfood to Facebook. Just doing nothing takes oil. But fighting heroic wars over the horizon, and War on Terror at home takes so much oil we dont even want to guess although the manufacturers of land battle tanks or helicopters can tell us how many barrels-per-hour their not-so-postindustrial goodies consume.

Today, even a downsized and losing war over the horizon needs borrowing to buy the oil it burns, but the mix of dreamtime hope and real world debt is toxic. Not being able to win those cute little wars over the horizon, to be sure is a downer for consumer morale, and like the post-Vietnam sequence for the USA, through 1975-79 we can be certain the former growth society, deprived of its raison d'etre, will shift into Black Swan domains where everything is possible and surprise is sure. Even designer wars can be admitted as unwinnable. That 'barbarous relic' of Keynes, gold instead of paper money, is a nice new idea. Buying food and gasoline now needs credit cards and debt: with creative financing this could be levered and structured - like we said, all is possible.

China and India will go on buying and importing oil until the bitter end. Today's four leading global oil importers, by rank are: USA, China, Japan, India. Like gold, oil prices can and will show "surprising and alarming" strength right up to the meltdown wire. Only recession pushing say 20 percent of the USA's population to the breadline soup kitchen, like in Spain already, and in other PIIGS economies very soon, will dent the high structural oil demand of the debt-wracked post-wealth post-growth economy.

THE NEOLIBERAL ALTERNATE: Like we know, this does not exist. Even its golden oldie of designer wars over the horizon has run out of collateral dead and the debt needed to pay for it. The new solution is emerging right now, with Norway in the lead. Our downsized neo-colonial wars over the horizon and being repatriated back home, dowsized again, and can use low cost tech like fertiizer bombs and cheap plastic wrapped copies of 5.56 mil infantry rifles with a Chinese made scope for trimming.

The very founding Mother and Father of the doctrine, Britain's Margaret Thatcher and US president Ronnie Reagan spelled it all out a long time ago - your neighbor is your enemy: profit from their downfall. The new war economy will feature iron rations and freeze-dried chow for bunker living, and those cute anti-radiation gasmasks we are getting to see and admire every day. When the Knights of the Temple attack those dirty bomb nuclear reactor targets littered around the oil-saving squeaky-clean New Economy, their bodycount can become as impressive as Anders Breivik wanted - lets say a few million here and there. To be sure, the historical antecedents are cast in stone. Both Mussolini and Hitler ran a war-time economy inside their fascist societies. Nice people have No Alternative today: its pedal to the metal!"

Andrew McKillop has more than 30 years experience in the energy, economic and finance domains. Trained at London UK’s University College, he has had specially long experience of energy policy, project administration and the development and financing of alternate energy. This included his role of in-house Expert on Policy and Programming at the DG XVII-Energy of the European Commission, Director of Information of the OAPEC technology transfer subsidiary, AREC and researcher for UN agencies including the ILO.

"Researchers at the University of Texas recently published a study about why men buy or lease flashy, extravagant, expensive cars like a gold plated Porsche Carrera GT. There conclusion was: “Although showy spending is often perceived as wasteful, frivolous and even narcissistic, an evolutionary perspective suggests that blatant displays of resources may serve an important function, namely as a communication strategy designed to gain reproductive rewards.”

To put that in laymen’s terms, guys drive flashy expensive cars so they can get laid. Researcher Dr Vladas Griskevicius said: “The studies show that some men are like peacocks. They’re the ones driving the bright colored sports car.”

It seems a vast swath of America refuse to shed their peacock feathers. This explains why you see BMWs, Mercedes, Escalades, and Porsches parked in the driveways of $100,000 houses. Automobiles are the truest representation of American peacock syndrome. Very few people look at a car purchase in a rational long term financial sense. It’s about impressing the neighbors, your peers and your family. Driving a brand new luxury car gives you the appearance of success. The neighbors don’t know you are in debt up to your eyeballs. This explains why 30% to 40% of all luxury cars are leased. A man could buy a $20,000 Honda hybrid with 10% down and finance the rest at 0.9% for three years. His monthly payment would be $500. After three years he would own the car outright, with the added benefit of getting 45 mpg. He could then invest the $500 per month for the next seven years in gold and silver or something else that benefits from Federal Reserve created inflation. In today’s society this would be the act of a dodo bird.

Why drive a putt putt car when you can drive the ultimate peacock machine – a BMW 528i with 24-valve inline 240-horsepower 6-cylinder engine with composite magnesium/aluminum engine block, Valvetronic, and Double-VANOS steplessly variable valve timing, 10-way power-adjustable driver’s and front passenger’s seat with 4-way lumbar support, and memory system for driver’s seat, steering wheel and outside mirrors, along with high-fidelity 12-speaker sound system, including 2 subwoofers under the front seats, and digital 7-channel amplifier with 205 watts of power. Plus it looks really cool. This materialism machine can be leased for the same $500 per month that the dodo bird pays for his Honda hybrid. Of course, after three years of renting luxury wheels the peacock has to turn in the 528i and lease an equally luxurious auto because driving an economy car would now harm his reputation. Colorful plumage is everything to a peacock.

Meanwhile, millions of Americans cling to their borrowed peacock feathers as the butcher of reality bears down upon them. The end won’t be pretty. The brave conquerors of strip malls across the land can enjoy their toys, gadgets, and treasures for awhile longer, but they need to remember one thing – glory is fleeting and death can come suddenly.

“For over a thousand years Roman conquerors returning from the wars enjoyed the honor of triumph, a tumultuous parade. In the procession came trumpeteers, musicians and strange animals from conquered territories, together with carts laden with treasure and captured armaments. The conquerors rode in a triumphal chariot, the dazed prisoners walking in chains before him. Sometimes his children robed in white stood with him in the chariot or rode the trace horses. A slave stood behind the conqueror holding a golden crown and whispering in his ear a warning: that all glory is fleeting.” - Last scene from the movie Patton"

“Here's how it all can come apart, and why Congress - and Obama - are both on the wrong track. Note this story from Bloomberg: 'Political wrangling over a plan to reduce the deficit may cost the U.S. its AAA rating, adding $100 billion a year to government costs while dragging down economic growth, according to Wall Street bond dealers. A U.S. credit-rating cut would likely raise the nation’s borrowing costs by increasing Treasury yields by 60 to 70 basis points over the “medium term,” JPMorgan Chase And Co.’s Terry Belton said today on a conference call hosted by the Securities Industry and Financial Markets Association.

But that's just the start, you see. Right now rates are at historic lows. So let's presume that the economy "improves"; if that happens then rates go up. In fact, there was a hearing this afternoon in the House Banking Subcommittee talking about exactly that. Here's the current Treasury MTS; it shows total interest on the public debt last year was $355 billion, and this year thus far is $386 billion. This implies (on a grossed-up 9/12ths basis) that the blended interest rate on the debt is running about 3%.

Here's the problem, in short: Rates have nowhere to go but up. So is 70 basis points "realistic"? No. If the economy improves, they'll go up double that or more just on their own on the short end. Then you get to add this "penalty" from the downgrade. We have the government claiming they will "cut" about $1 trillion in real spending (the rest is gimmicks - the wind-down of the wars that were going to happen anyway) over the next ten years. But if the economy improves the increased cost of the interest on the existing debt will be double that over the same ten years, and if we get downgraded you can double that again!

Each 100 basis points on $15 trillion in debt is $150 billion a year - every year - and the CBO says we'll have $25 trillion in debt by 2020. At a 4% blended interest rate this load on that $25 trillion will come to $1 trillion in interest annually - just 1 percent higher in interest than we're paying now! We will not get to 2020 folks; this is, in fact, exactly how the death spiral happens.

Interest expense as a percentage of government, this year, if the MTS thus far is 9/12ths of the total (through June), will run $515 billion. This out of a budget of $3.8 trillion (approximately) is ~14% of the total federal budget. To put this in perspective this is about 50% of the total receipts under federal income tax - just to pay interest!

Now I'm probably being pessimistic, because there's a roughly $80 billion "whack" that comes from semi-annual coupon payments in the trust funds, and we've already gotten both of those. So let's be nice and call the trust fund interest accrued already, which means we now get $249 + $199, or $448ish, which is about 12% of the budget. And that assumes that neither interest rates go up due to an improving economy or a downgrade.

What happens if that 3% blended rate goes up 70 basis points on a downgrade? Oh that's easy - just multiply that number by 123% and you're close enough. Call that $551, or ~$100 billion a year more. Each and every year for the next ten, that's $1 trillion. The problem is that the downgrade cannot be avoided without an actual credible $4 trillion in actual reductions in the deficit from the baseline. This means you can't count anything that was already expected to happen like the wars being wound down. It also means at least $400 billion in actual spending reductions for FY 2012 and then $400 billion more in each of the next three to four years! Or we can just do it in two - $750 now and $750 in FY2013.

We might get away with either of those plans, although the impact on the economy will be very significant - the exposure of the Depression we have been in since 2008 will occur with certainty. GDP will contract and coverage - that is, the percentage of federal income that goes to interest - will actually go up for a while rather than down! It has to because as the economy adjusts to the lack of deficit spending GDP will contract and tax revenue will fall.

It is, in fact, precisely this inescapable mathematical reality that means that we must deal with this now rather than attempting to kick the can and have the market make these choices for us. The outcome of taking our medicine will be bad. Very bad. But if we don't do it - and do it now - it's going to be worse. Much worse.”

"Somebody slipped Uncle Sam’s credit card under our hotel door yesterday morning. Well, almost. The image, as captured on the front page of Canada’s The Globe and Mail’s business section, showed the “National Credit Card of the United States of America…member since 1776…valid through 08/02/11.” The accompanying story, “Austerity Key to US Debt Talks,” gives a few of the troubling details. Here’s a list of “put it on the plastic” transactions Uncle Sam rang up on your behalf just last year, as provided by that Globe and Mail piece:

As you can see, there’s a bit of a discrepancy there. Well, a bit more than a bit. For every dollar the government spent in 2010, it was only able to steal roughly 62 cents through taxes. The rest came from the kindness of strangers with last names like Wong and Kim. Now, why would a Wong bother lending money to the US, you ask? A better question might be for how long will Wong lend? And what happens when Wong’s kindness runs out? You’d think such questions, and the uncomfortable answers they beg, would be enough to make politicians second guess their spending habits, tighten their belt a tad, shape up. Ha! Don’t make us laugh!

Thus far, the United States has incurred an impressive $14.3 trillion in public debt, “subject to limit,” as they say. Put another way, that’s about $46K per citizen, or $130K per taxpayer. At current rates, those figures will jump to $22.9 trillion by 2015; $70K per citizen, or almost $190k per taxpayer…assuming there are still working stones from which the politicians on Capitol Hill can extract blood four years from now.

And that’s not even factoring in the exponential growth debt expansion tends to deliver toward dying days of a typical Empire. In 2007, for example, that debt stood at about 36% of America’s GDP. Today, that same little monster has grown to reach 70% of GDP. All that in four years; one Olympiad! They grow up so quickly, don’t they? Even so, that’s some pretty gnarly spending, even by politicians’ own standards.

And what do these geniuses have to show for all of their greasy-mitted stimulus spending, for their various bailout programs and phony-baloney make-work schemes? What, in other words, does a few trillion dollars worth of other people’s money – some stolen, the rest begged and borrowed – buy you these days? More jobs? A rebound in the housing market? A new suit and tie? Any measure of honest, good-for-something growth? A – dare we even say the word – “recovery”? Not from the looks of it. Not even by the government’s own accounting!

The US economy probably grew at about a 2% annualized during the second quarter, a report due out this Friday is likely to show. That’s roughly 1-2% slower than it needs to grow just to keep pace with population expansion, just to add enough jobs to avoid going backwards. Which begs another question: What does a declining Empire look like, a giant, lumbering colossus of warfare misadventures and welfare promises? The grim picture will already look familiar to Fellow Reckoners, who’ve been patiently, if not painfully, listening to us rant and rave about the US debt crisis for years."

Tuesday, July 26, 2011

"In adult centers the nerve paths are something fixed, ended, immutable. Everything may die, nothing may be regenerated."- Santiago Ramon Y Cajal, "Degeneration and Regeneration in the Nervous System," 1928. This long-held tenet, first proposed by Professor Cajal, held that brain neurons were unique because they lacked the ability to regenerate.

In 1998, the journal "Nature Medicine" published a report indicating that neurogenesis, the growth of new brain cells, does indeed occur in humans. As Sharon Begley remarked in her book, "Train Your Mind, Change Your Brain," "The discovery overturned generations of conventional wisdom in neuroscience. The human brain is not limited to the neurons it is born with, or even the neurons that fill in after the explosion of brain development in early childhood." What the researchers discovered was that within each of our brains there exists a population of neural stem cells which are continually replenished and can differentiate into brain neurons. Simply stated, we are all experiencing brain stem cell therapy every moment of our lives.

As one might expect, the process of neurogenesis is controlled by our DNA. A specific gene codes for the production of a protein, brain-derived neurotrophic factor (BDNF) which plays a key role in creating new neurons. Studies reveal decreased BDNF in Alzheimer's patients, as well as in a variety of neurological conditions including epilepsy, depression, schizophrenia and obsessive-compulsive disorder. Fortunately, many of the factors that influence our DNA to produce BDNF factors are under our direct control. The gene that turns on BDNF is activated by a variety of factors including physical exercise, caloric restriction, curcumin and the omega-3 fat, DHA.

This is a powerful message. These factors are all within our grasp and represent choices we can make to turn on the gene for neurogenesis. Thus, we can treat ourselves to stem cell therapy by taking control of our gene expression.

Physical Exercise: Laboratory rats that exercise have been shown to produce far more BDNF in their brains compared to sedentary animals. And there is a direct relationship between elevation of BDNF levels in these animals and their ability to learn, as one might expect. With this understanding of the relationship of BDNF to exercise, researchers in a report in the Journal of the American Medical Association, entitled "Effect of Physical Activity in Cognitive Function in Older Adults at Risk for Alzheimer's Disease," found that elderly individuals engaged in regular physical exercise for a 24-week period had an improvement of an astounding 1,800 percent on measures of memory, language ability, attention and other important cognitive functions compared to an age-matched group not involved in the exercise program.

The mechanism by which exercise enhances brain performance is described in these and other studies as sitting squarely with increased production of BDNF. Just by engaging in regular physical exercise, you open the door to the possibility of actively taking control of your mental destiny.

Caloric Restriction: In January, 2009, the Proceedings of the National Academy of Science published a study entitled "Caloric Restriction Improves Memory in Elderly Humans." In this study, German researchers imposed a 30 percent calorie reduction on the diets of elderly individuals and compared their memory function with a similar age group who basically ate whatever they wanted. At the conclusion of the three-month study, those who ate without restriction experienced a small, but clearly defined decline in memory function, while memory function in the group consuming the calorie-reduced diet actually increased, and fairly profoundly. In recognition of the obvious limitations of current pharmaceutical approaches to brain health, the authors concluded, "The present findings may help to develop new prevention and treatment strategies for maintaining cognitive health into old age." What a concept. Preventive medicine for the brain.

Curcumin: Because curcumin, the main active ingredient in the spice turmeric, increases BDNF, it has attracted the interest of neuroscientists around the world. Interestingly, in evaluating villages in India where turmeric is used in abundance in curried recipes, epidemiological studies have found that Alzheimer's disease is only about 25 percent as common as in the U.S. There is little doubt that the positive effects of enhanced BDNF production on brain neurons is at least part of the reason why those consuming curcumin are so resistant to this brain disorder.

DHA: Like curcumin, DHA enhances gene expression for the production of BDNF. In a recently completed double-blind interventional trial, 485 healthy older individuals (average age 70 years) with mild memory problems were given a supplement containing DHA from marine algae or placebo for six months. Lead researcher of the study, Dr. Karin Yurko-Mauro, commented, "In our study, healthy people with memory complaints who took algal DHA capsules for six months had almost double the reduction in errors on a test that measures learning and memory performance versus those who took a placebo ... The benefit is roughly equivalent to having the learning and memory skills of someone three years younger."

Harnessing the expression of our DNA is empowering, and the tools to better brain health are available to us all - right now!"

David Perlmutter, MD, FACN, ABIHM is a Board-Certified Neurologist and Fellow of the American College of Nutrition who received his M.D. degree from the University of Miami School of Medicine where he was awarded the Leonard G. Rowntree Research Award. After completing residency training in Neurology, also at the University of Miami, Dr. Perlmutter entered private practice in Naples, Florida.

“What's happening to galaxy NGC 474? The multiple layers of emission appear strangely complex and unexpected given the relatively featureless appearance of the elliptical galaxy in less deep images. The cause of the shells is currently unknown, but possibly tidal tails related to debris left over from absorbing numerous small galaxies in the past billion years. Alternatively the shells may be like ripples in a pond, where the ongoing collision with the spiral galaxy just above NGC 474 is causing density waves to ripple though the galactic giant.

Click image for larger size.

Regardless of the actual cause, the above image dramatically highlights the increasing consensus that at least some elliptical galaxies have formed in the recent past, and that the outer halos of most large galaxies are not really smooth but have complexities induced by frequent interactions with - and accretions of - smaller nearby galaxies. The halo of our own Milky Way Galaxy is one example of such unexpected complexity. NGC 474 spans about 250,000 light years and lies about 100 million light years distant toward the constellation of the Fish (Pisces).”

“What Is War Good For? Sparking Civilization”
by University of California - Los Angeles

“Warfare, triggered by political conflict between the fifth century B.C. and the first century A.D., likely shaped the development of the first settlement that would classify as a civilization in the Titicaca basin of southern Peru, a new UCLA study suggests.

Charles Stanish, director of UCLA's Cotsen Institute of Archaeology, and Abigail Levine, a UCLA graduate student in anthropology, used archaeological evidence from the basin, home to a number of thriving and complex early societies during the first millennium B.C., to trace the evolution of two larger, dominant states in the region: Taraco, along the Ramis River, and Pukara, in the grassland pampas. "This study is part of a larger, worldwide comparative research effort to define the factors that gave rise to the first societies that developed public buildings, widespread religions and regional political systems - or basically characteristics associated with ancient states or what is colloquially known as 'civilization,'" said Stanish, who is also a professor of anthropology at UCLA. "War, regional trade and specialized labor are the three factors that keep coming up as predecessors to civilization." The findings appear online in the latest edition of "Proceedings of the National Academy of Sciences."

Conducted between 2004 and 2006, the authors' excavations in Taraco unearthed signs of a massive fire that raged sometime during the first century A.D., reducing much of the state to ash and architectural rubble. The authors compared artifacts dating from before and after the fire and concluded that agriculture, pottery and the obsidian industry, all of which had flourished in the state, greatly declined after the fire. Based on the range and extent of the destruction and the lack of evidence supporting reconstruction efforts, the authors suggest that the fire was a result of war, not of an accident or a ritual.

Iconographic evidence of conflict in regional stone-work, textiles and pottery suggests that the destruction of Taraco had been preceded by several centuries of raids. This includes depictions of trophy heads and people dressed in feline pelts cutting off heads, among other evidence. Because the downfall of Taraco, which was home to roughly 5,000 people, coincided with the rise of neighboring Pukara as a dominant political force in the region, the authors suggest that warfare between the states may have led to the raids, shaping the early political landscape of the northern Titicaca basin.

Inhabited between 500 B.C. and 200 A.D., Pukara was the first regional population center in the Andes highlands. During its peak, it covered more than 2 square kilometer and housed approximately 10,000 residents, including bureaucrats, priests, artisans, farmers, herders and possibly warriors. The civilization's ruins include impressive monolithic sculptures with a variety of geometric, zoomorphic and anthropomorphic images, plus intricate, multi-colored pottery in a variety of ritual and domestic forms.

War appears to have played a similar civilizing role in Mesoamerica, as well as Mesopotamia, Stanish said. To further test his theories on the origins of civilization, Stanish will begin a new project next year at a Neolithic site in Armenia.”

"A short nap during the afternoon is common in many countries and can provide an energy boost and clearer senses. As we focus on the many obligations we gladly undertake in order to create the lives we want, sleep is often the first activity that we sacrifice. We’re compelled by both external and internal pressures to be productive during many of our waking hours. While this can lead to great feats of accomplishment, it also disrupts the body’s natural cycles and leaves us craving rest. Napping represents a pleasurable remedy to this widespread sleep deprivation. Though judged by many as a pastime of little children or the lazy, the need for a nap is a trait that all mammals share and an acceptable part of the day in many countries. It is also a free and effortless way to improve our health and lift our spirits. A nap is relaxing and can improve our mood, vision, reflexes, and memory.

Lack of sleep, whether ongoing or the result of a single night’s wakefulness, puts stress on the body and mind. It can negatively impact your physical and mental health. At one time, napping was considered a natural part of life. In the past hundred years, however, electricity and modern conveniences have provided us with more time to engage in personal and professional activities. Consequently there is now less time for sleep. A mere ten minutes of sleep in the middle of the day can leave you feeling more cheerful and alert. A half-hour long nap can sharpen your senses and refresh your energy reserves, and a shorter nap can even sustain you through a long day. Napping can help you make up for lost sleep and serves as a supplement to your usual sleep schedule. You may need to give yourself permission to nap by making naptime a part of your day.

Feelings of guilt about napping or being preoccupied with other activities can keep you awake when you are trying to take a nap. If you need help, surround yourself with soft pillows and blankets or soothing music. Try to take a nap at the same time each day and use an alarm clock to ensure that you don’t fall into too deep a sleep. Learning to nap and enjoying its benefits can help you reclaim your natural right to nap. You nourish your being every time you take a nap."

"Perhaps everybody has a garden of Eden, I don't know; but they have scarcely seen their garden before they see the flaming sword. Then, perhaps, life only offers the choice of remembering the garden or forgetting it. Either, or: it takes strength to remember, it takes another kind of strength to forget, it takes a hero to do both. People who remember court madness through pain, the pain of the perpetually recurring death of their innocence; people who forget court another kind of madness, the madness of the denial of pain and the hatred of innocence; and the world is mostly divided between madmen who remember and madmen who forget. Heroes are rare."

“For an opinion or belief, 10 percent is critical mass. If that proportion of the population emphatically embraces an idea, then it will spread rapidly to the majority of the population, scientists have found. "When the number of committed opinion holders is below 10 percent, there is no visible progress in the spread of ideas," said researcher Boleslaw Szymanski, director of the Social Cognitive Networks Academic Research Center at Rensselaer Polytechnic Institute. "Once that number grows above 10 percent, the idea spreads like flame." For example, dictators who held power for decades in Tunisia and Egypt were overthrown in a matter of weeks when events pushed public opinion past the 10 percent threshold, Szymanski said.

Szymanski and colleagues tested out the spread of opinion using computer models of different social networks - one in which everyone was connected to everyone else, one with a few well-connected people and one in which everyone had the same, limited number of connections. In all cases, a few people within the network held an unwavering, but uncommon, belief; everyone else held a traditional view but was open-minded. They found that, regardless of the type of network, 10 percent remained the threshold required to shift the majority opinion once the true believers began to speak with everyone else.

This finding has broad implications for understanding how opinion spreads, according to the researchers. "There are clearly situations in which it helps to know how to efficiently spread some opinion or how to suppress a developing opinion," said Gyorgy Korniss, a study researcher and associate professor of physics at Rensselaer. "Some examples might be the need to quickly convince a town to move before a hurricane or spread new information on the prevention of disease in a rural village." The findings were published July 22 online in the journal 'Physical Review E.'"

"For centuries people have pondered the meaning of dreams. Early civilizations thought of dreams as a medium between our earthly world and that of the gods. In fact, the Greeks and Romans were convinced that dreams had certain prophetic powers. While there has always been a great interest in the interpretation of human dreams, it wasn't until the end of the nineteenth century that Sigmund Freud and Carl Jung put forth some of the most widely-known modern theories of dreaming. Freud's theory centered around the notion of repressed longing - the idea that dreaming allows us to sort through unresolved, repressed wishes. Carl Jung (who studied under Freud) also believed that dreams had psychological importance, but proposed different theories about their meaning.

Since then, technological advancements have allowed for the development of other theories. One prominent neurobiological theory of dreaming is the "activation-synthesis hypothesis," which states that dreams don't actually mean anything: they are merely electrical brain impulses that pull random thoughts and imagery from our memories. Humans, the theory goes, construct dream stories after they wake up, in a natural attempt to make sense of it all. Yet, given the vast documentation of realistic aspects to human dreaming as well as indirect experimental evidence that other mammals such as cats also dream, evolutionary psychologists have theorized that dreaming really does serve a purpose. In particular, the "threat simulation theory" suggests that dreaming should be seen as an ancient biological defense mechanism that provided an evolutionary advantage because of its capacity to repeatedly simulate potential threatening events - enhancing the neuro-cognitive mechanisms required for efficient threat perception and avoidance. So, over the years, numerous theories have been put forth in an attempt to illuminate the mystery behind human dreams, but, until recently, strong tangible evidence has remained largely elusive.

Yet, new research published in the "Journal of Neuroscience" provides compelling insights into the mechanisms that underlie dreaming and the strong relationship our dreams have with our memories. Cristina Marzano and her colleagues at the University of Rome have succeeded, for the first time, in explaining how humans remember their dreams. The scientists predicted the likelihood of successful dream recall based on a signature pattern of brain waves. In order to do this, the Italian research team invited 65 students to spend two consecutive nights in their research laboratory.

During the first night, the students were left to sleep, allowing them to get used to the sound-proofed and temperature-controlled rooms. During the second night the researchers measured the student's brain waves while they slept. Our brain experiences four types of electrical brain waves: "delta," "theta," "alpha," and "beta." Each represents a different speed of oscillating electrical voltages and together they form the electroencephalography (EEG). The Italian research team used this technology to measure the participant's brain waves during various sleep-stages. (There are five stages of sleep; most dreaming and our most intense dreams occur during the REM stage.) The students were woken at various times and asked to fill out a diary detailing whether or not they dreamt, how often they dreamt and whether they could remember the content of their dreams.

While previous studies have already indicated that people are more likely to remember their dreams when woken directly after REM sleep, the current study explains why. Those participants who exhibited more low frequency theta waves in the frontal lobes were also more likely to remember their dreams. This finding is interesting because the increased frontal theta activity the researchers observed looks just like the successful encoding and retrieval of autobiographical memories seen while we are awake. That is, it is the same electrical oscillations in the frontal cortex that make the recollection of episodic memories (e.g., things that happened to you) possible. Thus, these findings suggest that the neurophysiological mechanisms that we employ while dreaming (and recalling dreams) are the same as when we construct and retrieve memories while we are awake.

In another recent study conducted by the same research team, the authors used the latest MRI techniques to investigate the relation between dreaming and the role of deep-brain structures. In their study, the researchers found that vivid, bizarre and emotionally intense dreams (the dreams that people usually remember) are linked to parts of the amygdala and hippocampus. While the amygdala plays a primary role in the processing and memory of emotional reactions, the hippocampus has been implicated in important memory functions, such as the consolidation of information from short-term to long-term memory.

The proposed link between our dreams and emotions is also highlighted in another recent study published by Matthew Walker and colleagues at the Sleep and Neuroimaging Lab at UC Berkeley, who found that a reduction in REM sleep (or less "dreaming") influences our ability to understand complex emotions in daily life - an essential feature of human social functioning. Scientists have also recently identified where dreaming is likely to occur in the brain. A very rare clinical condition known as "Charcot-Wilbrand Syndrome" has been known to cause (among other neurological symptoms) loss of the ability to dream. However, it was not until a few years ago that a patient reported to have lost her ability to dream while having virtually no other permanent neurological symptoms. The patient suffered a lesion in a part of the brain known as the right inferior lingual gyrus (located in the visual cortex). Thus, we know that dreams are generated in, or transmitted through this particular area of the brain, which is associated with visual processing, emotion and visual memories.

Taken together, these recent findings tell an important story about the underlying mechanism and possible purpose of dreaming. Dreams seem to help us process emotions by encoding and constructing memories of them. What we see and experience in our dreams might not necessarily be real, but the emotions attached to these experiences certainly are. Our dream stories essentially try to strip the emotion out of a certain experience by creating a memory of it. This way, the emotion itself is no longer active. This mechanism fulfils an important role because when we don't process our emotions, especially negative ones, this increases personal worry and anxiety. In fact, severe REM sleep-deprivation is increasingly correlated to the development of mental disorders. In short, dreams help regulate traffic on that fragile bridge which connects our experiences with our emotions and memories."

"Political Paralysis Brought on By Government Spending"
by Bill Bonner

Dow down 88. Oil nudging against $100. Gold setting new record highs… And “Washington gripped by paralysis.” That’s what the papers say. We’ve seen the “Washington Paralysis” so often, we were beginning to think it was a new disease, discovered on the banks of the Potomac. Like Hong Kong Flu. Or Delhi belly.

“Paralysis” describes what most people see as America’s biggest weakness. We just wish it had a better grip. The politicians can’t get together and make up their minds. The theme is particularly common now because the debt ceiling hangs over the nation like…well, like a debt ceiling. Once the ceiling is hit horrible things will happen. The politicians will only be able to spend what they raise in tax revenues. They’ll have to live within their means, in other words. If that isn’t the end of the world, we don’t know what is!

Why is it the end of the world? Because the country has gotten used to spending money it doesn’t have and probably never will have. It spends the money on Medicaid and unemployment benefits and so forth. The feds send out 80 million checks a month. Without an increase in debt, millions of people won’t get their stolen money.

Of course, for all we know many of these government programs may be laudable, high-minded and in accordance with God’s Own Plan. If Jesus were around, he’d surely vote for the full budget as presented by the earnest people running the country. That is, if he were fool enough to get mixed up in politics in the first place.

Listening to CNN en Espagnol we discovered, among other things, some of the fine work of the Department of the Interior. The Spanish-language, paid-for commercials tell listeners that forests are good things and that if they’ve got forests or want to plant trees they can get money from the government. And of course, the world we be a better place as a result. And of course, these advertisements would probably be suspended if the feds couldn’t borrow money. And all because of paralysis in Washington. If only the pols could get up out of their wheelchairs and walk! They could come together and hug each other on the floor of that big building with the dome roof – the one that looks for all the world as though it was inspired by similar edifices of the Roman Empire period. Then, they could shake hands and agree on further currency and credit debasement.

Political paralysis is a good thing. If homo politico liberalis can’t come to terms with homo politico conservatoris, well at least they couldn’t get up to any mischief together. The rest of us could go on our way…creating and disposing of wealth…without too much interference. It is a lack of paralysis we fear. Such as the extraordinarily limber Congress of 1913. Those guys couldn’t find anything to disagree on. They passed the Federal Reserve Act with scarcely a polite conversation, let alone an active debate. They passed a lot of other obnoxious legislation too – including imposing an income tax and cutting the states out of Congress by requiring direct election of Senators (they used to be appointed by the states).

Then, there was the Congress that came to Washington with Franklin Roosevelt. What a jolly time that must have been. Backslapping, instead of backstabbing. Raising their hands together…all ‘ayes’ on setting up Social Security, the SEC, and the NHA. In just 100 days of 1933, they put in place the WPA, the CCC, the NYA, the NRA, the PWA and the FERA. There was hardly a single letter of the alphabet that stirred up a controversy. They found common cause on every one of them.

Skipping over a lot of accord, we come to the 21st century, and there we find George W. Bush and his team on Capitol Hill. Practically the entire Washington establishment was on the same side again…beating with one heart…breathing with one lung…thinking with no brains whatsoever. Get along, go along; with few exceptions they went along with the looniest war in US history and the most ruinous spending ever. And then, if that wasn’t bad enough, hard on their heels came Barack Obama and the Congress of 2009. Whoa…there was a little discord there…which caused a slight arthritic palsy…but no paralysis! Despite the creeping rigor mortis on the Republican side, the president was able to push through a massive, hugely expensive bill that changed the nation’s entire health industry.

How we could have used a little more paralysis then! But now paralysis works against us. Not in the way the media thinks, of course. Now, the course of the empire is set. We will spend our way at home…and bumble our way abroad….to our own destruction. That is the course that has been set. The pols will move their creaky bones…maybe they already have…to raise the debt ceiling so they can stay on course. Then, little by little, one by one, they will come to their senses and see the brick wall in front of them. But they will be paralyzed…stuck…locked on target. They will be unable to change course…unable to save themselves…or the empire. Empires are like automobiles without reverse. They can’t back up. There. That’s our prediction. We’re sticking with it unless and until events prove us wrong.

As Congress becomes more and more paralyzed, the can-do military machine becomes more popular. We see it in our churches. And we see it in our airports. Jillian Tett, a reporter for The Financial Times, had the same reaction we did: “In Europe, it is rare even to see anyone in military uniform, far less to venerate them in symbolic terms. US airport crowds, however, are often dotted with fatigues, and it is common to hear the airport [loudspeaker] declare that ‘members of the military and their families’ can…board before anyone else. I am starting to see a dark underside to these announcements…”

We explained yesterday how the middle class got ‘thrown under the bus.’ It was just part of the imperial bargain. The US military got to throw its weight around in Europe and Asia. The foreigners got to sell us stuff…thus undermining American manufacturing. In the last 10 years alone, for example, a third of all remaining manufacturing jobs were lost. Now, the few jobs that are being created are no longer middle class jobs. They are low-paying service industry jobs. Hotel cleaners. Hospital orderlies. Car parkers. People who provide services to the old…or the rich. In 1980 more than half of all jobs were middle class. Now, the total is only 42%. Meanwhile, the percentage of lower class jobs grew, from 30% to 40%.

Here’s yet another glimpse at where this leads. From The New York Times: "Consumers in the US are increasingly using credit cards to pay for basic necessities as income gains fail to keep pace with rising food and fuel prices. The dollar volume of purchases charged grew 10.7 percent in June from a year ago, while the number of transactions rose 6.8 percent, according to First Data Corp.’s SpendTrend report issued this month. The difference probably represents the increasing cost of gasoline, said Silvio Tavares, senior vice president at First Data, the largest credit card processor. “Consumers, particularly in the lower-income end, are being forced to use their credit cards for everyday spending like gas and food,” said Tavares, who’s based in Atlanta. “That’s because there’s been no other positive catalyst, like an increase in wages, to offset higher prices. It’s a cash-flow problem.”

After-tax income adjusted for inflation fell 0.1 percent from January through May, according to figures from the Commerce Department. The drop came as Labor Department data showed energy prices rose 8.2 percent and food climbed 2 percent during the same period. The value of an average transaction on credit cards outpaced the gain for debit cards, showing consumers are increasingly relying on borrowing to pay for gasoline and other necessities, Tavares said. The figures are in synch with data from the Federal Reserve. Revolving credit, credit card balances, increased by $3.37 billion to $793.1 billion in May from an almost seven-year low of $789.8 billion in April, figures from the central bank showed. The gain was equivalent to a 5.1 percent increase at an annual rate. The use of credit cards is a “smoking gun” that indicates some consumers, including the long-term unemployed who have lost jobless benefits, are resorting to other sources of cash flow just to “get by,” said David Rosenberg, chief economist at Gluskin Sheff & Associates Inc. in Toronto.

The Tea Party is a reaction to this. People in the middle classes feel as though they’ve been ripped off. They don’t understand by whom, why or how…but they’ve got a feeling someone is making a profit at their expense. “Remember what Warren Buffett says,” our weekend guest reminded us. “If you’re in a poker game and you can’t identify the fool at the table…you’re it. Well, these Tea Party people feel like they’re it. And they’re not too happy about it.”

Barack Obama is probably a one-term president. Not that he’s a bad egg, especially. But when a large percentage of the voters feel like victims, a well-mannered community organizer and law professor is not likely to last long as their leader. The masses want someone to translate their agony…their feeling of being victimized…their resentment and their desire to get something for nothing. They want a champion. Someone who simplifies things…and gives them voice.

And what will that voice say? Will it explain the theory of competitive advantage or the rule of reversion to the mean? Will it describe how the US got so far ahead of the rest of the world and how it is only natural that the rest of the world now catches up? Will it elucidate the causes of excess credit expansion and let the middle classes know that they were jackasses for going along with it? Will it talk to them honestly, explaining the need for huge cutbacks in military and social welfare spending? We don’t think so. Instead, it will rally them around the home team – America’s men at arms. It will turn on the printing presses and treat anyone who opposes this agenda as a traitor. Are we being too negative, dear reader, too pessimistic…too gloomy? We hope so."

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